Trading plan Forex for 18.12.2018

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Asian markets followed Wall Street and continued their declines with repeated concerns about slowing growth. After a strong sell-off in the US (SP500 down -2.08%), the Asian stock market saw no other option but to connect to pessimism.

Chinese Shanghai Composite falls 0.76%, and Japanese Nikkei has decreased by 1.82%. In the currency market, an increased turnover resulted in small changes in exchange rates: EUR / USD stands at 1.1340, and USD / JPY drifts just above 112.50. NZD stands out as it increased to 0.6850 USD after reading the ANZ business confidence index: in December it rose to -24.1 from -37.1.

On Tuesday, the 18th of December, the event calendar is light in important data releases. The event of the day might be the German Ifo data releases scheduled early in the morning during the London session. Other important macroeconomic events that are worth keeping an eye on are Housing Starts and Building Permits data from the US. No speeches are scheduled from today as well.

USD/JPY analysis for 18/12/2018:

Masatsugu Asakawa commented on the factors affecting the value of the yen. The Japanese finance minister noticed that the times were past when the changes in current accounts were mainly due to the value of currencies. The main factor now is the flow of capital. He also added that producers exporting goods usually do not change prices, even if the yen rate falls.

Asakawa believes that the priority of next year's G20 summit should be the issue of global imbalance. This problem belongs to the G20 group basic responsibilities as the members should strengthen cooperation among themselves to help balance.

Let's now take a look at the USD/JPY technical picture at the H4 time frame. The market has failed to break through the level of 113.70 and the price reversed towards the nearest technical support at the level of 113.18, which was broken as well. Currently, the price is trading around the level of 112.65 after a low at the level of 112.46 was made recently. The key technical support level is seen at 112.23 and weak and negative momentum is helping bears to test this level soon.